Mukesh Patel.in
practical tax & investment planning online
international tax expert / columnist / author / speaker

TAX & REPAT BONANZA FOR NRIs!

With RBI allowing free transfer of funds from NRE to NRO Accounts, NRIs can plan tax exemption & easy repatriation!

                         In the past decade, the Reserve Bank of India (RBI) has granted liberal facilities to Non-Resident Indians (NRIs), not only for repatriation of their current income earned in Indian Rupees, but also for remittances for specified purposes and substantial repatriation out of their Non-Resident Ordinary bank accounts. 

                         For the above purposes, an NRI would in fact mean not only an Indian National Resident outside India, but also a Foreign National of Indian origin who is a Non Resident i.e. Persons of Indian Origin (PIOs).

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COURT CHAMPIONS TAXPAYER CAUSE!

Delhi HC initiates suo motu PIL on problems of faulty return processing, TDS credit & refunds and asks CBDT to explain!

                          A Chartered Accountant Anand Parkash addressed a letter dated April 30, 2012 to the Delhi High Court, in which he set out numerous problems being faced by the taxpayers across the country owing to faulty processing of Income-tax Returns and non-grant of TDS credit & refunds. He pointed out that lakhs of taxpayers, for no fault of their own, were being required to face grave hassles on account of the current tax procedures and prayed that the Court may be pleased to issue suitable directions to the Income-tax Department to mitigate their genuine hardships and save them from the harassment in filing revised returns and rectification petitions every year.

 

                    In an almost unprecedented move in the history of Income-tax administration, it is indeed so heartening, that taking judicial notice of this letter, the High Court took immediate action by converting it into a public interest writ petition and passed an order dated May 4, 2012, directing the Central Board of Direct Taxes (CBDT) and other respondents to answer the following averments made in the letter: 

 

  • Taxpayers are called upon to pay huge demands, which are created because of mismatch of TDS claimed in the Income Tax return. This is primarily because of the fact that the Income-tax Department gives credit only for TDS which stands reflected in their online computer records i.e. Form 26AS.
  • Whenever any deductor, being a Government Department, Office, Bank etc., deducts TDS on behalf of a taxpayer, a quarterly statement of TDS deducted, along with PAN of deductee and other details is required to be filed. Even if there is a slightest mismatch in reporting the particulars of the deductee, the TDS deducted is not reflected in the Form 26AS and as such, no credit of TDS is allowed to the taxpayer, resulting in unnecessary demand and the hassle of getting rectification done. (more…)

AXE YOUR TAX AND RELAX!

With diverse recipes available for tax saving u/s. 80 C savings & investments require some smart planning!

             The scheme of Section80Cof the Income-tax Act provides for deduction out of taxable income of a taxpayer who is an individual or HUF, in respect of specified savings, investments and allocations made by them during the financial year.

             Section80C offers deduction to either an individual or HUF. However, there are diverse recipes under Section80Cprescribed for the two entities. An HUF does not enjoy the entire range of choices under Section80Cas available to an individual. Moreover, some investment or spending avenues, such as contribution to statutory or recognized provident fund or housing loan repayment are exclusively available only to the concerned salary earner or house owner as the case may be.

           However, there are several other deductions, which offer fairly flexible opportunities for tax planning and it is in respect of some of these, that a head of the household must do some smart thinking. 

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FM’s BUDGET ON A ROCK & ROLL!

One year deferment of GAAR, equity savings scheme & some TCS concession likely to be announced in Finance Bill today!

              Taxpayers are bound to keenly watch the Lok Sabha proceedings today, as the FM rises to move some amendments in the Finance Bill, 2012, which is slotted for discussion and approval of the House on May 7 & 8.

ANY ROLLBACK ON GAAR?

              Will there be any rollback on the highly controversial and hotly debated GAAR is the big question doing the rounds. One thing is sure and that is, the FM has indeed realized the serious implications of GAAR as proposed. Even the Parliament’s Standing Committee on Finance, in its report on the Direct Taxes Code (DTC) has seriously urged the Finance Ministry to deal with a whole package of its recommendations on GAAR. Whereas the FM is unlikely to announce any blanket withdrawal, it is very likely that he may announce atleast a one year deferment in the implementation of GAAR, so that many grave concerns and several important aspects in this regard can be examined. It is also expected that the highly iniquitous provision in relation to the burden of proof placed on the taxpayer may be knocked off and the constitution of the Approving Panel for GAAR may be designed in a more objective manner, with a view to dispel the critical reservations regarding the fairness of its implementation. (more…)

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